YETI’s Growth and Cash-Flow Outlook Draw StockStory Criticism

YETI shares traded at $42.42, down 2.1% since the previous close, as of 16:15 UTC on Sept. 29. StockStory cited modest long-term sales growth, a flat cash-flow outlook and unchanged returns on invested capital in its critical assessment.

The publisher said YETI’s sales grew at an 8.7% compound annual rate over five years, below its benchmark for the consumer discretionary sector. It did not specify the benchmark.

Analysts’ consensus estimates expect free-cash-flow margin to remain at 13.2% over the next year, matching the level for the trailing 12 months, according to StockStory.

StockStory also said YETI’s return on invested capital has stayed unchanged over the past few years. The measure compares operating profit with money raised through debt and equity, the publisher said.

Despite its concerns, StockStory described YETI’s valuation as fair at 13.5 times forward earnings, based on the article’s share price of $43.05. The article said shares had returned 21.2% over six months, compared with a 22.1% gain for the S&P 500.